M2.4: Case Study: The Turnaround Story at Leonard Cheshire

The Turnaround Story at Leonard Cheshire
Issues to Consider as You Read This Story
LO 2.5
1. What image, or images, of change management does Clare Pelham illustrate?
2. What insights does this story have to offer concerning the role of the change leader?
3. What lessons about managing organizational change can we take from this experience and apply to other organizations, in healthcare and in other sectors?
The Context
Leonard Cheshire was the largest charity in the United Kingdom, supporting thousands of people with physical and learning disabilities and acquired brain injuries. The charity’s support included care in a range of residential settings, respite services, and skills development to build confidence and to improve employability. The charity employed 7,500 staff in over 300 different services, in the United Kingdom and internationally. The charity also had the support of 3,500 volunteers.
The Problem
Clare Pelham was appointed chief executive in November 2010. The charity’s income was £155 million, and it had a deficit of £5.4 million. The tenures of four previous chief executives had been short. Her immediate predecessor lasted 18 months, implementing a reorganization with the loss of 100 managerial and administrative jobs. Japan Tobacco International had been chosen, with much controversy, as a commercial partner. The Care Quality Commission, a national healthcare regulator, was about to restrict activities at some of the charity’s care homes. The charity was founded in 1948 by Group Captain Geoffrey Leonard, who died in 1992. Pelham had worked as a volunteer at a Leonard Cheshire home as a teenager, but her ambitions had taken her into a management career in other public- and private-sector organizations. Now, how to solve the charity’s problems?
The Solution
Phase 1: Pelham said, “I always start with the people.” On her first day in her new role, she met with each of her senior managers individually. She then visited the charity’s homes. Action was swift:
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I started in November and by the first week in December we had a new strategy. You need to do things quickly. You also need to be clear as a group of people about why are we here? What do we believe in and how are we going to achieve it?
One of her other first actions was to hold a management board meeting with no agenda:
We talked about how we were going to work together. I suggested they all share with each other the things they had said to me personally. We came up with some ways of working. It was guidelines like, if you write anything down, it can be shown to anyone, copied or forwarded to anyone and you should be prepared to stand by what you have written.
The aim was to develop openness and trust. The guidelines also applied to conversations; “We agreed you should never say something about someone you would not say to their face.” Pelham also banned the “b” and “f” words: blame, fault, failure. In order to build pride in the work of the charity, Pelham encouraged a culture of “you don’t walk past”:
If I am late or if anybody is late for anything and the reason is that it is because they saw something that was not OK and they stopped to address it, then that’s fantastic. If you are doing something to make life easier or better for any individual person, what else could you be doing that is more important than that?
Phase 2: How did the focus on people and culture address the charity’s financial problems? Pelham was also concerned with procedures, measurement, and information:
I think leadership is a caring profession. You cannot do it well if you do not care about the people. You need the heart, but you need to enable the people day to day and engage your head so I am quite big on having procedures because that’s how you measure. Let’s have ways of doing things, to protect the confidentiality of whistleblowers, for example, or ensure safeguarding. Sometimes you want to depart from them but let’s do that knowing you are doing it. You need information gathering so that you can see where you are and see a trend. It is no good saying that this is a good idea and not measuring. That’s not going to do disabled people any good at all.
Fundraising was to become everyone’s business, not a specialist function, and Pelham held regular meetings to gather ideas and prompt action. Significant savings came from making procurement more efficient and by reducing spending on expensive agency staff by more than a third while improving continuity of care. Pelham received personal weekly reports on these efficiencies. Speaking about her leadership role and style, she said:
It is my responsibility when things go wrong and if anyone is to blame it is me and if anyone is to go and answer for it or resign because of it, it is me. If you accept that people share your commitment and passion and values and they are not doing things as well as they can, you have to look in the mirror first and ask: what is it that you could have done to help them do the job they came in to do?
One indicator of Pelham’s passion and values concerned her attitude to the traditional practice of making short support visits to older people. These visits, provided by local councils and care services, were funded to last only 15 minutes. She decided to start a campaign to stop this practice:
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Our 15 minute campaign came out of a conversation where one of my colleagues talked me through what a 15 minute visit meant. I asked, “Are we OK with this?” We decided we would no longer bid for them and we would actively campaign against them. Our staff hate these visits and every day see people suffering. They love that we are prominent in trying to make this stop.
The charity’s condemnation of these visits triggered outrage at the practice and was headline news. The government’s Care Bill was amended accordingly—a triumph for Pelham.
The Outcomes
In 2013, the charity’s income was £160 million, with a surplus of £3 million. Voluntary donations had increased by 20 percent over the previous two years, to £13.4 million. In 2014, Leonard Cheshire Disability had a surplus, and it started to expand and refurbish its supported living accommodation.
Story Sources
Carlisle, D. 2014. The woman who banned the f-word. Health Service Journal (February 28): 24–28.
http://www.leonardcheshire.org/

The Turnaround Story at Leonard Cheshire

Introduction

Clare Pelham was appointed as the chief executive of Leonard Cheshire when the company was experiencing an income deficit. Through her management and leadership, the organization was able to turn around and increase its income. The various images of change that were demonstrated by Clare Pelham as the chief executive at the company are discussed in this paper, as well as the lessons that leaders can learn from her style of leadership.

Images of Change Management

Clare demonstrated a number of images of change management in her leadership at Leonard Cheshire. She demonstrated the images of a director, a navigator, and a coach. As the leader, she took the responsibility of designing the change process and directing the staff towards the fulfillment of change objectives. She was able to develop a strategy of change and come up with the targets of change. She also involved the company’s board in the development of a change strategy (Myers, Hulks, & Wiggins, 2012). As a navigator, Clare Pelham developed a change process within the company and came up with a way to best meet the change objectives. She ensured that fundraisings were used to increase revenue and that procurement was improved. She was able to improve staff morale by stopping the fifteen-minute visits. As a coach, Clare Pelham assisted the members of the company to develop essential capabilities for success achievement (Kuipers et al., 2014). She was also able to ensure trust and openness between the leadership and the employees by leading by example. Pelham also stressed the importance of assisting employees to realize their role within the company to ensure that they work with passion and commitment.

Insights into the Role of a Change Leader

The leadership role that Clare Pelham played at the firm contributed to the success of the company. The role of a change leader within an organization should include improving collaboration with the employees and encouraging feedback. A leader needs to involve the employees in the process of implementing change and transforming the organization (Cummings & Worley, 2013). Just like Clare involved her employees in the entire change process, a change leader should include employees in strategic planning and goal setting. By involving the employees, a change leader ensures that employees are pressured into achieving the goals they set. It also ensures that a good environment for open communication is established. Another insight into the role of a change leader is that a leader needs to track the change progress to ensure that focus on goals is maintained. By tracking the change implementation progress, a change leader generates the urgency of the change process and builds the confidence and morale of the employees (Cummings & Worley, 2013). Clare also demonstrates that a change leader needs to ensure consistent communication and lead by example. Communication ensures that confusion and misunderstanding are avoided during the change process. By leading by example, a change leader sets the pace and directs employees through the change process.

Managing Organizational Change

Clare Pelham shows that planning early is important for successful change implementation. She also shows that planning should involve the employees of an organization to ensure their commitment and encourage open commitment (Myers, Hulks, & Wiggins, 2012). Planning for change should first identify the needs of an organization and then proceed to identify ways by which they can be fulfilled while solving the existing problems and challenges. Lastly, the organizational change should seek to develop a better organizational culture.

Conclusion

In conclusion, the various images of change management contribute to the success of the change process. A change leader plays an important role in the change process by developing the best change strategy and initiating the change.

References

Cummings, T. G., & Worley, C. G. (2013). Organization Development and Change. Stamford.

Kuipers, B. S., Higgs, M., Kickert, W., Tummers, L., Grandia, J., & Van der Voet, J. (2014). The management of change in public organizations: A literature review. Public Administration, 92(1), 1-20.

Myers, P., Hulks, S., & Wiggins, L. (2012). Organizational change: Perspectives on theory and practice. Oxford: Oxford University Press.